These are the Most At-Risk Housing Markets in the Country
California, Illinois, Florida and New York City are the areas with the highest concentration of counties vulnerable to declines in the housing market, while less-vulnerable markets are clustered in other areas of the Northeast, Midwest and South. This is according to the latest Special Housing Risk Report published by ATTOM, which analyzed fourth-quarter gaps in affordability, underwater mortgages, foreclosures and unemployment.
Five of the most at-risk markets were in and around Chicago, four were in or near New York City, seven were scattered across Florida, and 14 were in California. Markets that appear least exposed to housing market declines are Wisconsin, Virginia, Tennessee and Pennsylvania, with four in the Washington, D.C. area and three each in the Nashville and Richmond areas.
"Local housing markets fluctuate in and out of the lists of areas more or less exposed to declines from quarter to quarter, but some regions consistently rank among the most vulnerable due to significant gaps in key market indicators," said ATTOM CEO Rob Barber. "This report isn't meant to raise red flags or predict endless gains — it simply highlights counties experiencing more or less pressure that could influence home values, foreclosures, or homeowner equity."
The study found that major home-ownership costs, including mortgage payments, property taxes and insurance, for a median-priced single-family home or condo are considered seriously unaffordable in 28 of 50 of the most vulnerable markets. That means those expenses consumed at least 43% of average local wages, while major expenses required only 34% of average local wages nationwide. Residential mortgages were underwater in 29 out of the 50 most at-risk counties, slightly above the 5.7% national average. More than one of every 1,000 properties faced foreclosure in 37 of the 50 most vulnerable counties, while nationwide one in 1,671 homes dealt with this risk. The unemployment rate was at least 5% in half of the most at-risk counties, while it was 4.2% nationwide.
Meanwhile, major ownership costs were labeled seriously unaffordable in only 10 of the 51 counties considered least vulnerable to decline, and only two of the least vulnerable markets had more than 6% of mortgages underwater. None of the least-at-risk counties had more than one in 1,000 properties facing foreclosure, and the unemployment rate was less than the national average in all 51 of the least-at-risk counties.
Source: GlobeSt/ALM